When it comes to stale checks, simply voiding the old one and reissuing a new one is usually all it takes to solve the problem, but there are always exceptions.
Dealing with checks the bank returns as “non-negotiable-stale dated” can present significant challenges, as well as unnecessary headaches for your A/P staff.
It’s not uncommon for some stale checks to require a fair amount of investigation including phone calls, e-mails, vendor letters, etc. But how much time do you really want A/P to spend on these problem checks?
There are some industry best practices for dealing with stale checks based on the amount of the check:
- $1,000 and over: Anything over $1,000 should raise a red flag for A/P staffers to go full-throttle on the follow-up, including calling and sending letters to the last known address of the payee or to the consulting directory.
- $100 to $999: These checks require less effort, but an attempt to contact the payee should be made at least once.
- $35 to $99: Use your discretion here. Any effort to follow-up should be made as time allows.
- Less than $35: For smaller amounts you should minimize the time you spend trying to find the payee — unless there are special circumstances surrounding the check in question.
Note: To streamline escheatment reporting later, you should make some effort to find the owners.